Q3 2026 Madison Square Garden Entertainment Corp Earnings Call

May 7, 2026

Operator 2: Good morning. Thank you for standing by, and welcome to the Madison Square Garden Entertainment Corp fiscal 2026 Q3 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's remarks, there will be a question and answer session. I would now like to turn the call over to Ari Danes, Senior Vice President, Investor Relations and Treasury. Please go ahead.

Operator: Good morning. Thank you for standing by, and welcome to the Madison Square Garden Entertainment Corp fiscal 2026 Q3 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's remarks, there will be a question and answer session. I would now like to turn the call over to Ari Danes, Senior Vice President, Investor Relations and Treasury. Please go ahead.

Speaker #4: After the speaker's remarks, there will be a question and answer session. I would now like to turn the call over to Ari Danes, Senior Vice President, Investor Relations and Treasury.

Speaker #4: Please go ahead. Thank you. Good morning and welcome to MSG Entertainment's Fiscal 2026 third quarter earnings conference call. On today's call, David Collins, our EVP and Chief Financial Officer, will provide an update on the company's operations and review our financial results for the period.

Ari Danes: Thank you. Good morning and welcome to MSG Entertainment's fiscal 2026 Q3 earnings conference call. On today's call, David Collins, our EVP and Chief Financial Officer, will provide an update on the company's operations and review our financial results for the period. After our prepared remarks, we will open up the call for questions. If you do not have a copy of today's earnings release, it is available in the investors section of our corporate website. Please take note of the following: Today's discussion may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements are not guarantees of future performance or results and involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements.

Speaker #4: After our prepared remarks, we will open up the call for questions. If you do not have a copy of today's earnings release, it is available in the Investors section of our corporate website.

Speaker #4: Please take note of the following: today's discussion may contain forward-looking statements within the meaning of the private securities litigation reform act of 1995. Any such forward-looking statements are not guarantees of future performance or results, and involve risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements.

Speaker #4: Please refer to the company's filings with the SEC for a discussion of risks and uncertainties. The company disclaims any obligation to update any forward-looking statements that may be discussed during this call.

Ari Danes: Please refer to the company's filings with the SEC for a discussion of risks and uncertainties. The company disclaims any obligation to update any forward-looking statements that may be discussed during this call. On pages 4 and 5 of today's earnings release, we provide consolidated statements of operations and a reconciliation of operating income to adjusted operating income or AOI, a non-GAAP financial measure. With that, I'll now turn the call over to David.

Ari Danes: Please refer to the company's filings with the SEC for a discussion of risks and uncertainties. The company disclaims any obligation to update any forward-looking statements that may be discussed during this call. On pages four and five of today's earnings release, we provide consolidated statements of operations and a reconciliation of operating income to adjusted operating income or AOI, a non-GAAP financial measure. With that, I'll now turn the call over to David.

Speaker #4: On pages four and five of today's earnings release, we provide consolidated statements of operations and a reconciliation of operating income to adjusted operating income or AOI, a non-gap financial measure.

Speaker #4: And with that, I'll now turn the call over to David. Thank you, Ari, and good morning, everyone. We're now in the final stretch of Fiscal 2026, and I'm pleased to say that demand for our live entertainment offerings remains strong.

David Collins: Thank you, Ari. Good morning, everyone. We're now in the final stretch of fiscal 2026, and I'm pleased to say that demand for our live entertainment offerings remains strong. For the company's fiscal Q3, we generated revenues of $246 million and adjusted operating income of $46 million. Behind these results were a number of important drivers, including continued momentum in our concert business at The Garden, growth in marketing partnerships and suites, and the last shows of this past season's record-setting Christmas Spectacular run. Looking ahead, we expect to close out fiscal 2026 on a positive note, led by a significant increase in the number of concerts at The Garden in our fiscal Q4 compared to last year. We remain on track to deliver robust full-year growth in revenue and AOI.

Speaker #4: For the company's fiscal third quarter, we generated revenues of $246 million and adjusted operating income of $46 million. Behind these results were a number of important drivers, including continued momentum in our concert business at the Garden, growth in marketing partnerships and suites, and the last shows of this past season's record-setting Christmas spectacular run.

Speaker #4: Looking ahead, we expect to close out Fiscal 26 on a positive note, led by a significant increase in the number of concerts at the Garden in our fiscal fourth quarter compared to last year.

Speaker #4: And we remain on track to deliver robust full-year growth in revenue and AOI. What's especially encouraging is that we already see this momentum carrying into Fiscal 27.

David Collins: What's especially encouraging is that we already see this momentum carrying into fiscal 2027, with our concert calendar filling up, including Harry Styles' 30-night residency at the arena and the 2026 Christmas Spectacular production currently on sale. Let's now walk through some of the key operational highlights from Q3. During the quarter, our venues welcomed over 1.4 million guests at more than 165 events, reflecting the breadth and diversity of events we are bringing to our venues. That included a year-over-year increase in the number of concerts at The Garden, highlighted by several notable multi-night runs. That growth was partially offset by a decrease in the number of concerts across our theaters. From a demand standpoint, we continue to see the vast majority of concerts at our venues sell out.

Speaker #4: With our concert calendar filling up, including Harry Styles' 30-night residency at the arena, and the 2026 Christmas spectacular production currently on operational highlights from the third quarter.

Speaker #4: During the quarter, our venues welcomed over 1.4 million guests at more than 165 events, reflecting the breadth and diversity of events we are bringing to our venues.

Speaker #4: That included a year-over-year increase in the number of concerts at the Garden, highlighted by several notable multi-night runs. That growth was partially offset by a decrease in the number of concerts across our theaters.

Speaker #4: From a demand standpoint, we continue to see the vast majority of concerts at our venues sell out. In addition, food and beverage per caps at concerts were up in the quarter, while merchandise per caps were down, both of which we primarily attribute to the mix of events.

David Collins: In addition, food and beverage per caps at concerts were up in the quarter, while merchandise per caps were down, both of which we primarily attribute to the mix of events. In our family show category, we welcomed back the Westminster Kennel Club to the Garden for the dog show's 150th anniversary. On the sports booking side, we had a busy quarter with college basketball, including St. John's and the Big East Tournament, along with boxing, professional bull riding, and WWE. On the special events front, we faced a tough comparison against the prior year quarter, which benefited from Saturday Night Live's multi-day takeover of Radio City for its 50th anniversary special. However, we are looking forward to hosting the Tony Awards at the venues next month.

Speaker #4: In our family show category, we welcomed back the Westminster Kettle Club to the Garden for the dog shows 150th anniversary. And on the sports booking side, we had a busy quarter with college basketball, including St.

Speaker #4: John's, and the Big East tournament, along with boxing, professional bull riding, and WWE. On the special events front, we faced a tough comparison against the prior year quarter, which benefited from Saturday Night Live's multi-day takeover of Radio City for its 50th anniversary special.

Speaker #4: However, we are looking forward to hosting the Tony Awards at the venue next month. Turning to the Christmas spectacular, the show's 92nd holiday season concluded in January with a record-setting run generating approximately $195 million in total revenues across 215 paid performances.

David Collins: Turning to the Christmas Spectacular, the show's 92nd holiday season concluded in January with a record-setting run generating approximately $195 million in total revenues across 215 paid performances. 16 of those shows took place in our fiscal Q3, delivering year-over-year growth in per-show ticketing revenue. As I mentioned earlier, sales for the 2026 holiday season are now underway. With 230 shows currently on sale, we believe the production is well-positioned to deliver growth again next fiscal year. Once again, we saw higher per game revenues across our various revenue and profit-sharing arrangements with MSG Sports as compared to the prior year.

Speaker #4: 16 of those shows took place in our fiscal third quarter, delivering year-over-year growth in per-show ticketing revenue. As I mentioned earlier, sales for the 2026 holiday season are now underway.

Speaker #4: With $230 shows currently on sale, we believe the production is well positioned to deliver growth again next fiscal year. Our fiscal third quarter also included the continuation of the Nixon Rangers' 25-26 regular seasons at the Garden.

Speaker #4: And once again, we saw higher per-game revenues across our various revenue and profit-sharing arrangements with MSG Sports as compared to the prior year. And lastly, on the marketing partnerships and premium hospitality front, Fiscal 2026 has been highlighted by several notable sponsorship announcements, while we have also seen strong new sales and renewal activity for suites at the Garden this year.

David Collins: Lastly, on the marketing partnerships and premium hospitality front, fiscal 2026 has been highlighted by several notable sponsorship announcements, while we have also seen strong new sales and renewal activity for suites at The Garden this year. We remain on track for growth across both of these businesses in fiscal 2026. Let's turn to our financial results. For the fiscal 2026 Q3, we reported revenues of $246.3 million, an increase of 2% as compared to the prior year quarter. This reflected an increase in revenues from entertainment offerings, partially offset by lower arena license fees and other leasing revenues, as well as a decrease in food, beverage, and merchandise revenues. The increase in revenues from entertainment offerings primarily reflected growth in suite license fee revenues, including amounts subject to the sharing of economics with MSG Sports.

Speaker #4: We remain on track for growth across both of these businesses in Fiscal 26. Now let's turn to our financial results. For the fiscal 26 third quarter, we reported revenues of $246.3 million in increase of 2% as compared to the prior year quarter.

Speaker #4: This reflected an increase in revenues from entertainment offerings partially offset by lower arena license fees and other leasing revenues as well as a decrease in food, beverage, and merchandise revenues.

Speaker #4: The increase in revenues from entertainment offerings primarily reflected growth in suite license fee revenues including amounts subject to the sharing of economics with MSG Sports.

Speaker #4: As we discussed earlier, we also benefited from strong growth in the number of concerts at the Garden during the quarter. In addition, revenues from our Christmas spectacular production increased year over year, primarily due to higher per-show ticket revenue and one additional performance in the quarter, both as compared to the prior year period.

David Collins: As we discussed earlier, we also benefited from strong growth in the number of concerts at The Garden during the quarter. In addition, revenues from our Christmas Spectacular production increased year-over-year, primarily due to higher per-show ticket revenue and one additional performance in the quarter, both as compared to the prior year period. The overall increase in revenues from entertainment offerings was partially offset by a decrease in revenues from other live entertainment and sporting events. This reflected a decrease in the number of events at our venues, including the absence of Saturday Night Live's 50th anniversary special and the final shows of Annie's extended holiday run in the prior year quarter. Additionally, as mentioned earlier, we saw a decrease in the number of concerts at the company's theaters this quarter.

Speaker #4: The overall increase in revenues from entertainment offerings was partially offset by a decrease in revenues from other live entertainment and sporting events. This reflected a decrease in the number of events at our venues including the absence of Saturday Night Live's 50th anniversary special and the final shows of Annie's extended holiday run in the prior year quarter.

Speaker #4: Additionally, as mentioned earlier, we saw a decrease in the number of concerts at the company's theaters this quarter. Arena license fees and other leasing revenues decreased year over year, primarily due to the Nixon Rangers playing fewer home games during the fiscal third quarter partially offset by higher other leasing revenues.

David Collins: Arena license fees and other leasing revenues decreased year-over-year, primarily due to the Knicks and Rangers playing fewer home games during the fiscal Q3, partially offset by higher other leasing revenues. Similarly, the modest decrease in food, beverage, and merchandise revenues mainly reflected the impact of fewer Knicks and Rangers home games during the current year quarter, which was partially offset by higher food and beverage sales at concerts. Q3 adjusted operating income of $46 million decreased $12 million as compared to the prior year Q. This primarily reflects higher direct operating and SG&A expenses, partially offset by the increase in revenues. Turning to our balance sheet, as of 31 March, we had $323 million of unrestricted cash, up from $157 million as of 31 December.

Speaker #4: Similarly, the modest decrease in food, beverage, and merchandise revenues mainly reflected the impact of fewer Nixon Rangers home games during the current year quarter which was partially offset by higher food and beverage sales at concerts.

Speaker #4: Third quarter adjusted operating income of $46 million decreased $12 million as compared to the prior year quarter. This primarily reflects higher direct operating and SG&A expenses partially offset by the increase in revenues.

Speaker #4: Turning to our balance sheet, as of March 31st, we had $323 million of unrestricted cash, up from $157 million as of December 31st. This increase reflects strong cash flow generation as well as an increase in cash due to promoters primarily due to future events at the Garden.

David Collins: This increase reflects strong cash flow generation as well as an increase in cash due to promoters, primarily due to future events at The Garden. In addition, our debt balance at quarter end was $587 million. As a reminder, we have repurchased approximately 623,000 shares of our Class A common stock for $25 million fiscal year to date. We have approximately $45 million remaining under our current buyback authorization, and going forward, we will continue to explore ways to opportunistically return capital to shareholders. In summary, as we approach the end of the fiscal year, we remain on a clear path to delivering a robust fiscal 2026 and believe we are well positioned to drive long-term value for our shareholders. I will now turn the call back over to Ari.

Speaker #4: In addition, our debt balance at quarter end was $587 million. As a reminder, we have repurchased approximately $623,000 shares of our Class A common stock for $25 million fiscal year to date.

Speaker #4: We have approximately $45 million remaining under our current buyback authorization and going forward, we will continue to explore ways to opportunistically return capital to shareholders.

Speaker #4: So in summary, as we approach the end of the fiscal year, we remain on a clear path to delivering a robust fiscal 26 and believe we are well positioned to drive long-term value for our shareholders.

Speaker #4: I will now turn the call back over to Ari.

Speaker #1: Thanks, David. Operator, can we now open up the call for questions, please?

Ari Danes: Thanks, David. Operator, can we now open up the call for questions, please?

Speaker #3: Thank you. We will now begin the question-and-answer session. If you would like to ask a question, please press star 1 to raise your hand.

Operator 2: Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, please press star one again. We ask that you pick up your handset when asking a question. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Peter Henderson with Bank of America. Your line is open. Please go ahead.

Operator: Thank you. We will now begin the question and answer session. If you would like to ask a question, please press star one to raise your hand. To withdraw your question, please press star one again. We ask that you pick up your handset when asking a question. If you are muted locally, please remember to unmute your device. Please stand by while we compile the Q&A roster. Your first question comes from the line of Peter Henderson with Bank of America. Your line is open. Please go ahead.

Speaker #3: To withdraw your question, please press star 1 again. We ask that you pick up your handset when asking a question. If you are muted locally, please remember to unmute your device.

Speaker #3: Please stand by while we compile the Q&A roster. Your first question comes from a line of Peter Henderson with Bank of America. Your line is open.

Speaker #3: Please go ahead.

Speaker #4: Yeah. Good morning. Thank you for taking the question. So there have been several press reports recently around the Penn Station redevelopment. I think including some commentary from President Trump in the New York Post indicating that his preferred path for the project is to keep the Carden where it currently sits.

Peter Henderson: Good morning, thank you for taking the question. There have been several press reports recently around the Penn Station redevelopment, I think including some commentary from President Trump in the New York Post indicating that his preferred path for the project is to keep the Garden where it currently sits. Can you just update us on your conversations related to the Penn Station renovation and the impact to the Infosys Theater? Thank you.

Speaker #4: And can you just update us on your conversations related to the Penn Station renovation and the impact to the infamous theater? Thank you.

Speaker #5: Yeah. Good morning, Peter. Thanks. Thanks for the question. While I really don't want to comment on press reports, here's what I will share with you.

David Collins: Good morning, Peter. Thanks for the question. You know, while I really don't want to comment on press reports, you know, here's what I will share with you. The United States Department of Transportation and Amtrak, you know, they continue to reiterate their intended project schedule. Based on that reported timeline, RFP submissions were recently due from the three shortlisted bidders. Amtrak is now expected to select a master developer this month and to announce the preliminary design in June. As redevelopment of the area continues, we are fully committed to collaborating closely with all the stakeholders. You know, but with that said, you know, we don't really have much more to report than that, but we will certainly keep you know, posted as there's progress.

Speaker #5: The US Department of Transportation and Amtrak, they continue to reiterate their intended project schedule. And based on that reported timeline, RFP submissions were recently due from the three shortlisted bidders.

Speaker #5: So Amtrak is now expected to select a master developer this month and to announce the preliminary design in June. So as redevelopment of the area continues, we are fully committed to collaborating closely with all the stakeholders but with that said, we don't really have much more to report than that, but we will certainly keep you posted as the progress.

Speaker #4: Thanks.

Peter Henderson: Thanks.

Speaker #3: Your next question comes from the line of Stephen Lasik with Goldman Sachs. Your line is open. Please go ahead.

Operator 2: Your next question comes from the line of Stephen Laszczyk with Goldman Sachs. Your line is open. Please go ahead.

Speaker #6: Hey. Thanks for taking the questions. David, I was hoping you could give us an update on how you're thinking about the opportunity for capital returns.

Stephen Laszczyk: Hey, thanks for taking the questions. David, I was hoping you could give us an update on how you're thinking about the opportunity for capital returns. I think in the past you've mentioned that you would think about taking an opportunistic approach to buybacks. It doesn't sound like there was stock bought back in Q1. Curious if there's been an opportunity since or if there's any more color you could provide on how you're thinking about either buybacks or dividends moving forward.

Speaker #6: I think in the past, you've mentioned that you would think about taking an opportunistic approach to buybacks. It doesn't sound like there was stock bought back in the March quarter.

Speaker #6: Curious if there's been an opportunity since or if there's any more color you could provide on how you're thinking about either buybacks or dividends moving forward.

Speaker #4: Sure, Stephen. Thanks for the question. In terms of buying back stock, we take a number of factors into account. In determining when we repurchase shares and that includes the forward outlook for our business, which remains very positive.

David Collins: Sure, Stephen. Thanks for the question. You know, in terms of buying back stock, you know, we take a number of factors into account, you know, in determining when we repurchase shares. You know, that includes the forward outlook for our business, which remains very positive. You know, however, you know, sometimes, you know, even including subsequent to our last earnings call in February, you know, opportunities to repurchase shares present themselves when we don't find ourselves in an open window period. You know, that said, if you look at our track record since our spin-off, you'll see that, you know, we have bought back a substantial amount of stock, you know.

Speaker #4: However, sometimes even including subsequent to our last earnings call in February opportunities to repurchase shares present themselves when we don't find ourselves in an open window period.

Speaker #4: So that said, if you look at our track record since our spin-off, you'll see that we have bought back a substantial amount of stock and going forward, we will continue to look for opportunities within the context of our three broader capital allocation priorities, which once again are maintaining a strong balance sheet, having appropriate flexibility to pursue growth opportunities when and if they arise, and also opportunistically returning capital to our shareholders.

David Collins: Going forward, you know, we will continue to look for opportunities, you know, within the context of our, you know, 3 broader capital allocation priorities, which, you know, once again are in maintaining a strong balance sheet, having appropriate flexibility to pursue growth opportunities when and if they arise, and, you know, and also opportunistically returning capital to our shareholders.

Speaker #6: Great. Thanks for that. And then maybe just on expenses, the underlying cost structure came in a bit elevated in the quarter. I was just hoping you could unpack some of that for us and then how we should be thinking about the expense lines or margins as we sink into the balance of the year.

Stephen Laszczyk: Great. Thanks for that. Maybe just on expenses, the underlying cost structure came in a bit elevated in the quarter. I was just hoping you could unpack some of that for us, how we should be thinking about the expense lines or margins as we sink into the balance of the year. Thank you.

Peter Henderson: Great. Thanks for that. Maybe just on expenses, the underlying cost structure came in a bit elevated in the quarter. I was just hoping you could unpack some of that for us, how we should be thinking about the expense lines or margins as we sink into the balance of the year. Thank you.

Speaker #6: Thank you.

Speaker #4: Sure. Great. Yeah. No, there's certainly were a number of moving parts this quarter. So let me walk you through it. To start, this past quarter included the impact of several million dollars of unanticipated costs spread across both direct and SG&A expense.

David Collins: Sure. Great. Yeah, no, there's certainly a number of moving parts this quarter, you know, let me walk you through it. To start, you know, this past quarter included the impact of several million dollars of unanticipated costs spread across both direct and SG&A expense. You know, this was driven by a few different items. For example, we incurred higher than expected healthcare benefit expenses due to generally higher overall healthcare costs, as well as increased claims activity. You can see in today's results that our venue operating costs increased $2.4 million year over year, which reflects those higher healthcare expenses, including the impact of truing up some costs to our most recent estimate. In addition, the increase in direct operating expenses reflects the mix of events across our venues.

Speaker #4: This was driven by a few different items. For example, we incurred higher than expected healthcare benefit expenses due to generally higher overall healthcare costs as well as increased claims activity.

Speaker #4: You can see in today's results, that our venue operating costs increased 2.4 million year over year, which reflects those higher healthcare expenses. Including the impact of truing up some costs to our most recent estimate.

Speaker #4: In addition, the increase in direct operating expenses reflects the mix of events across our venues. For example, a year ago quarter had a number of multi-night runs, which came with lower costs and higher margins.

David Collins: For example, the year-ago quarter had a number of multi-night runs which came, you know, with lower costs and higher margins. For instance, the Saturday Night Live's 50th anniversary special at Radio City. That was really a mix of events. In terms of SG&A expense, we also saw the impact of those higher healthcare costs there, you know. Even excluding those costs, our SG&A expense grew this quarter, you know, was still elevated and above what we would expect our long-term expense growth rate to be. You know, that includes the impact of higher employee compensation, which is, you know, pretty consistent with what we've said in the past about higher labor costs this fiscal year.

Speaker #4: For instance, the Saturday Night Live 50th Anniversary Special at Radio City. So that was really a mix of events. In terms of SG&A expense, we also saw the impact of those higher healthcare costs there.

Speaker #4: And even excluding those costs, our SG&A expense grew this quarter. It was still elevated and above what we would expect our long-term expense growth rate to be in that includes the impact of higher employee compensation, which is pretty consistent with what we've said in the past about higher labor costs this fiscal year.

Speaker #4: So, I would say, overall, as we look ahead, we expect SG&A expense growth to begin to normalize on a year-over-year basis in our June quarter.

David Collins: You know, I would say overall, as we look ahead, we expect SG&A expense growth to begin to normalize on a year-over-year basis in our Q2, and also expect that to carry over into our, you know, the start of our fiscal 2027.

Speaker #4: And also expect that to carry over into the start of our fiscal 27.

Speaker #6: Great. Thank you.

Stephen Laszczyk: Great. Thank you.

Speaker #3: Your next question comes from the line of Cameron Manson Perrone with Morgan Stanley. Your line is open. Please go ahead.

Operator 2: Your next question comes from the line of Cameron Mansson-Perrone with Morgan Stanley. Your line is open. Please go ahead.

Operator: Your next question comes from the line of Cameron Mansson-Perrone with Morgan Stanley. Your line is open. Please go ahead.

Speaker #5: Thanks, and morning. You highlighted a bit in the prepared remarks, but was wondering if you could just elaborate on how concert bookings are pacing in the fiscal fourth quarter and maybe through the rest of the calendar year.

Cameron Mansson-Perrone: Thanks. Morning. You highlighted a bit in the prepared remarks, but was wondering if you could just elaborate on how concert bookings are pacing in the fiscal Q4 and maybe through the rest of the calendar year. Thanks.

Speaker #5: Thanks.

Speaker #4: Sure. Great, Cameron. Thanks. First, I'd like to say again that we are headed for a strong end to fiscal 2026 at the Garden and that will reflect a significant growth in the number of concerts at the arena in our fiscal fourth quarter.

David Collins: Sure. Great, Cameron. Thanks. You know, first I'd like to say again that, you know, we are headed for a strong end to fiscal 2026 at the Garden, and that will reflect a significant growth in the number of concerts at the arena, you know, in our fiscal Q4. In terms of H1 of fiscal 2027, we continue to see a number of positive signs in concert bookings. You know, at this stage, we have substantial visibility into the September quarter, where we are pacing well ahead at the Garden. In fact, we remain on track to shatter our record for number of concerts in any quarter at the venue, which of course includes the impact of the Harry Styles residency.

Speaker #4: In terms of the first half of fiscal 27, we continue to see a number of positive signs in concert bookings. At this stage, we have substantial visibility into the September quarter.

Speaker #4: Where we are pacing well ahead at the Garden. In fact, we remain on track to shatter our record for a number of concerts in any quarter at the venue, which of course includes the impact of the Harry Styles residency.

Speaker #4: And at our theaters, I would say we are currently pacing behind for the September quarter. However, as we've said in the past, the bookings window in our theaters is typically three to six months in advance.

David Collins: At our theaters, I would say, you know, we are currently pacing behind for the Q3. However, you know, as we've said in the past, the bookings window in our theaters is typically 3 to 6 months in advance. You know, we still have some time and are working to narrow that gap. You know, looking at the Q4, it's still a bit early to discuss pacing for our theaters given the shorter booking window I just mentioned, but, you know, at the Garden we are again pacing ahead. All in, we are pleased with how our concert bookings are pacing so far for fiscal 2027, and we continue to believe the Garden is likely headed towards another year of strong concert growth in fiscal 2027.

Speaker #4: So we still have some time and are working to narrow that gap. Looking at the December quarter, it's still a bit early to discuss pacing for our theaters given the shorter booking window I just mentioned.

Speaker #4: But at the Garden, we are again pacing ahead. So all in, we are pleased with how our concert bookings are pacing so far for fiscal 27 and we continue to believe the Garden is likely headed towards another year of strong concert growth in fiscal 27.

Speaker #4: And while still very early, we see potential to drive growth for our theaters as well in the fiscal 27.

David Collins: You know, and while still very early, you know, we see potential to drive growth for our theaters as well in the fiscal 2027.

Speaker #5: Very helpful. Thanks.

Cameron Mansson-Perrone: Very helpful. Thanks.

Speaker #3: Your next question comes from the line of David Karnofsky with JPMorgan. Your line is open. Please go ahead.

Operator 2: Your next question comes from the line of David Karnovsky with JP Morgan. Your line is open. Please go ahead.

Operator: Your next question comes from the line of David Karnovsky with JP Morgan. Your line is open. Please go ahead.

Speaker #7: Hey, thanks. Maybe just given some of the recent macro rise in energy prices, it'd be good to get your expanded view on demand both as it relates to current or forward ticket sales or maybe what you're seeing in per caps.

David Karnovsky: Hey, thanks. Maybe just given some of the recent macro rise in energy prices, it'd be good to get your expanded view on demand, both as it relates to current or forward ticket sales or maybe what you're seeing in per caps.

Speaker #4: Sure, David. We certainly are always keeping a close eye on the macro environment with everything going on in the world. And I have to say we continue to see strong consumer demand.

David Collins: Sure, David. You know, we certainly are always keeping a close eye on the macro environment with, you know, everything going on in the world. I have to say, we continue to see strong consumer demand. You know, a number of factors that support that. You know, as I mentioned earlier, a vast majority of our concerts at our venues were again sold out this past Q4 and overall F&B per cap spending at our concerts was up year-over-year. Year-to-date, we have continued to see concerts perform better than we initially expected. A number of our upcoming acts across our venues have also added additional shows due to strong demand.

Speaker #4: A number of factors that support that. As I mentioned earlier, a vast majority of our concerts at our venues were again sold out this past quarter and overall F&B per cap spending at our concerts was up year over year.

Speaker #4: Year to date, we have continued to see concerts perform better than we initially expected. A number of our upcoming acts across our venues have also added additional shows due to strong demand.

Speaker #4: And when we look at the next two quarters, the sell-through rate for concerts is currently pacing ahead of where it was at the same time last year.

David Collins: You know, when we look at the next two quarters, the sell-through rate for concerts is currently pacing ahead of where it was at the same time last year. I would say given all this, you know, watching the macro environment, you know, we continue to see strong demand from consumers.

Speaker #4: So I would say given all this, watching the macro environment, we continue to see strong demand from consumers.

Speaker #7: Okay. And then I just wanted to see if you could update on your residency pipeline both for the Garden and then maybe also the theaters.

David Karnovsky: Okay. I just wanted to see if you could update on your residency pipeline, both for the Garden and then maybe also the theaters.

Speaker #4: David, you came in a little staticky from our end, but I think you were asking about the residency pipeline. So we'll go ahead and answer that.

Ari Danes: David, you came in a little staticky from our end, but I think you were asking about the residency pipeline, so we'll go ahead and answer that.

Speaker #7: Sure. Sure, David. As far as residencies go, first I'd like to reiterate that we are off to a strong start in terms of concert bookings for fiscal 2027.

David Collins: Sure. Sure, David. You know, as far as residencies go, you know, first I'd like to reiterate that we are off to a strong start in terms of concert bookings for fiscal 2027, and that, of course, includes the Harry Styles residency at the Garden for 30 nights. I'd also like to add that we have Bon Jovi for a 9-show residency and Phish for a 5-show residency at the Garden this summer. You know, at our theaters, Joe Hisaishi will be doing a 7-night residency at Radio City in August. Seth Meyers and John Oliver recently extended their long-running residency at the Beacon Theatre into this fall.

Speaker #7: And that, of course, includes the Harry Styles residency at the Garden for 30 Nights. I'd also like to add that we have Bon Jovi for a nine-show residency in Fish for a five-show residency at the Garden this summer.

Speaker #7: And at our theaters, Joe Hisaishi will be doing a seven-night residency at Radio City in August, Seth Meyers and John Oliver recently extended their long-running residency at the Beacon Theater into this fall.

David Collins: You can see that we believe there's a great value in bringing residencies to our venues, as, you know, we believe it builds more of a recurring base of business and also increases our visibility into the forward calendar. I would say residencies remain an important area for our booking business. You know, while it's early to discuss fiscal 2028 and beyond, we are continuing to have discussions with other artists about future residencies at all the venues, including The Garden, and we will certainly keep you updated on our progress.

Speaker #7: So you can see that we believe there's a great value in bringing residencies to our venues as we believe it builds more of a recurring base of business and also increases our visibility into the forward calendar.

Speaker #7: So, I would say residencies remain an important area for our booking business, and while it's early to discuss fiscal 2028 and beyond, we are continuing to have discussions with other artists about future residencies at all the venues, including the Garden, and we will certainly keep you updated on our progress.

Speaker #7: Thank you.

David Karnovsky: Thank you.

Speaker #3: Your next question comes from the line of David Joyce with Seaport. Your line is open. Please go ahead.

Operator 2: Your next question comes from the line of David Joyce with Seaport. Your line is open. Please go ahead.

Operator: Your next question comes from the line of David Joyce with Seaport. Your line is open. Please go ahead.

Speaker #8: Thank you. Given the NYX strong progress in the playoffs, again this year, can you discuss the benefits or headwinds to the NYX advancing to the MSG Entertainment business?

David Joyce: Thank you. Given the Knicks' strong progress in the playoffs again this year, can you discuss the benefits or headwinds to the Knicks advancing to the MSG Entertainment business? Thank you.

Speaker #8: Thank you.

Speaker #4: Sure, David. Thanks. Thanks for the question. I'd have to say we are excited to see the NYX in the second round of the playoffs and they are off to a great start.

David Collins: Sure, David. Thanks for the question. I have to say, we are excited to see the Knicks in the second round of the playoffs. They are off to a great start. You know, as you know, we benefit from playoff games at the Garden through our agreement with MSG Sports in a few ways. We share in revenue streams like F&B and merchandise, as well as single-night suite sales. As you know, we operate and manage the F&B services during all team events, for which MSG shares 50% of the net profits with the Knicks and Rangers. We also operate and manage the team merchandise sales at the Garden and retain 30% of net revenues.

Speaker #4: As you know, we benefit from playoff games at the Garden through our agreement with MSG Sports in a few ways. We share in revenue streams like F&B and merchandise as well as single nights, sweet sales.

Speaker #4: As you know, we operate and manage the F&B services during all team events for which MSG shares 50% of the net profits with the NYX and Rangers.

Speaker #4: We also operate and manage the team merchandise sales at the Garden and retain 30% of net revenues. And we also earn a commission on the sales of single night suites at the Garden during NYX and Rangers games.

David Collins: We also earn a commission on the sales of single-night suites at the Garden during Knicks and Rangers games. You know, we benefit during the playoffs here. One other thing to point out as well is, you know, that we believe that strong team performance, like the Knicks are having right now, will benefit next year in the form of, you know, continued strong arena attendance, you know, which will further benefit those shared revenue streams that I just mentioned with sports. I'd also mention, you know, from the booking side, booking concerts during the playoff window continues to be an opportunity that we've been targeting to drive utilization at the Garden, and we've had success this fiscal year at doing so.

Speaker #4: So we benefit during the playoffs here. One other thing to point out as well is that we believe that strong team performance like the NYX are having right now will benefit next year in the form of continued strong arena attendance.

Speaker #4: Which will further benefit those shared revenue streams that I just mentioned with sports. I'd also mention from the booking side, booking concerts during the playoff window continues to be an opportunity that we've been targeting to drive utilization at the Garden.

Speaker #4: And we've had success this fiscal year at doing so. As I mentioned earlier, we are expecting significant year-over-year growth in the number of concerts at the Garden in our fiscal fourth quarter.

David Collins: You know, as I mentioned earlier, you know, we are expecting significant year-over-year growth in the number of concerts at the Garden in our fiscal Q4. You know, that includes an increase in the number of concerts that we book during the playoff window. You know, that's something that we're gonna strive to continue to do.

Speaker #4: And that includes an increase in the number of concerts that we booked during during the playoff window. So that's something that we're going to strive to continue to do.

Speaker #8: Great. Thank you.

David Joyce: Great. Thank you.

Speaker #4: Thanks, David. Operator, we have time for one last caller.

Ari Danes: Thanks, David. Operator, we have time for one last caller.

Speaker #3: Thank you. Your next question is from Joe Stoff with Susquehanna. Your line is open. Please go ahead.

Operator 2: Thank you. Your next question comes from Joe Stauff with Susquehanna. Your line is open. Please go ahead.

Operator: Thank you. Your next question comes from Joe Stauff with Susquehanna. Your line is open. Please go ahead.

Joe Stauff: Thank you. Good morning, David, Ari. The value of your Christmas Spectacular asset obviously is important, continues to grow nicely. You know, you're increasing show count this year 7%. How do you assess demand, you know, versus that 7% show count? This is gonna be the 3rd year in a row, certainly, that you're increasing show count, so there is pretty significant, obviously, demand that continues to grow. How do you think about that? You had mentioned advanced ticket sales. You know, how much or how many of those tickets are sold already? How does that evolve towards, you know, the opening of the show in Q4?

Speaker #9: Thank you. Good morning, David. All right. The value of your Christmas spectacular asset obviously is important and continues to grow nicely. Your increasing show count this year, 7%.

Speaker #9: How do you assess demand versus that 7% show count? This is going to be the third year in a row, certainly that you're increasing show counts.

Speaker #9: So it's pretty significant. Obviously, demand that continues to grow. How do you think about that and you had mentioned advanced ticket sales? How much or how many of those tickets are sold already?

Speaker #9: And how does that evolve towards the opening of the show in the December quarter?

Speaker #4: Thanks, Joe. Good morning. Yeah. So we see we definitely see growth potential for next year's Christmas spectacular. Through both more shows as you mentioned and higher average ticket yields.

David Collins: Thanks, Joe. Good morning. We see, we definitely see growth potential for next year's Christmas Spectacular, you know, through both more shows, as you mentioned, and higher average ticket yields. As you mentioned, we, you know, we are on sale for 230 performances for the next holiday season, you know, up from 215 last year, which translates, as you mentioned, mid-single digit percentage increase in show count year over year. You know, one of the things that's important to remember and where we see growth is that, you know, the Christmas Spectacular continues to be a premium entertainment product and we believe it's still priced well below average ticket prices for comparable entertainment options.

Speaker #4: As you mentioned, we are on sale for 230 performances for the next holiday season up from 215 last year, which translates, as you mentioned, mid-single-digit percentage increase in show count year over year.

Speaker #4: One of the things that's important to remember and where we see growth is that the Christmas spectacular continues to be a premium entertainment product and we believe it's still priced well below average ticket prices for comparable entertainment options.

Speaker #4: So I think as we add shows, we marketing and pricing our ticket inventory to maximize revenue for each show. And in terms of advanced ticket sales, we initially went on sale just in March and we'll begin marketing the production over the summer.

David Collins: You know, I think as we add shows, we will be thoughtfully managing marketing and pricing our ticket inventory to maximize revenue for each show. You know, in terms of advanced ticket sales, we initially went on sale just in March and we'll begin marketing the production over the summer. I think it's a little bit early in the sales cycle to discuss pacing as of now. You know, again, we are confident in the growth opportunity for this 2026 holiday season.

Speaker #4: So I think it's a little bit early in the sale cycle to discuss pacing as of now. But again, we are confident in the growth opportunity for this 26 holiday season.

Speaker #3: We have reached the end of the Q&A session. I will now turn the call back to Ari for closing remarks.

Operator 2: We have reached the end of the Q&A session. I will now turn the call back to Ari for closing remarks.

Operator: We have reached the end of the Q&A session. I will now turn the call back to Ari for closing remarks.

Speaker #4: Thank you all for joining us. We look forward to speaking with you on our next earnings call. Have a good day.

Ari Danes: Thank you all for joining us. We look forward to speaking with you on our next earnings call. Have a good day.

Speaker #3: And this concludes today's call. Thank you for attending. You may now disconnect.

Operator 2: This concludes today's call. Thank you for attending. You may now disconnect. This event has now concluded. Thank you for joining Madison Square Garden Entertainment Corp. fiscal 2023 Q3 earnings conference call.

Operator: This concludes today's call. Thank you for attending. You may now disconnect. This event has now concluded. Thank you for joining Madison Square Garden Entertainment Corp. fiscal 2023 Q3 earnings conference call.

Speaker #10: This event has now concluded. Thank you for joining Madison Square Garden Entertainment Corporation fiscal 2026 third quarter earnings conference call. The line will disconnect automatically.